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Trump's Tariff Truce Offers Little Relief to Small Businesses

Published 3 days ago3 minute read
Trump's Tariff Truce Offers Little Relief to Small Businesses

Small business owners are expressing uncertainty and concern regarding the recent 90-day tariff pause with China, stating that it is insufficient for confident planning. The short duration of the trade deal leaves many feeling like they are "gambling," unsure of the taxes existing orders will face. Some have even paused expansion plans due to the ambiguity.

Connor Alexander, a board game publisher in Seattle, Washington, had to pause production on two projects when tariffs on Chinese imports soared to 145%. When tariffs dropped to 30% under the new trade agreement, Alexander greenlit a new board game, hoping it would arrive in the US before the 90-day window closes. However, he worries that if tariffs return to 145%, he will be out of business. "This pause on the tariffs doesn't really help me. In fact, it just kind of terrifies me, because we're in a situation where 90 days from now is the earliest my stuff could be hitting the port," Alexander stated.

Haley Pavone, the founder and CEO of Pashion Footwear, described the trade deal as "a mix of relief, but also frustration." Pavone explained that the 90-day reprieve is not enough time to make any significant changes, as her shoes take four months to produce. She is unsure what taxes she will pay on her fall products, which are expected to arrive in August. "It's anyone's guess," she said.

Hugo Ramirez, owner of Frio Mexican Treats in Appleton, Wisconsin, had paused all orders from China when tariffs were at 145% and switched to more expensive, non-customized US manufacturers. Although the tariffs have been lowered, he has stopped considering expansion due to the need to purchase new machines from China. He has managed to keep prices stable on core items but raised prices on premium products.

Jessica Kim, owner of Mycha LA and Chicago, which operates vending machines for boba and specialty teas, sees the 90-day window as a brief opportunity to receive a shipment but insufficient for long-term planning. An order of 10 machines that was delayed due to the high tariffs is now scheduled to arrive by mid-June. "I was trying to time it, almost like gambling," she said.

The small business owners emphasized that the uncertainty makes it difficult to predict costs and plan budgets. Alexander anticipates a $10 to $20 price hike on his games if tariffs remain at 30%. He has already informed his customers that he cannot accurately predict costs. "I'm taking a chance. I'm gambling on my business," Alexander said.

Pavone has been forced to remain cautious, which will likely impact her supply and pricing long-term. She has had to play a "guessing game" while putting together her holiday order. Pavone has also been impacted by President Donald Trump's closing of the de minimis loophole, leading her to raise prices and attach a tariff tax to US orders.

Expansion plans have been paused as a result of the tariff uncertainty. Pavone rescinded a job offer, and Ramirez has stopped thinking about expansion. While Ramirez is focused on solutions, he remains unsure of the upside of the tariffs. "If they're going to fix the current markets and help us small businesses grow, I'm all for it," he said. "But as far as what I can see, this is what my experience is."

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